Experts say Melbourne’s next Toorak could already be emerging in suburbs like Elwood, Richmond and Reservoir, with ripple-effect buyers seeking capital growth, lifestyle and long-term legacy.
The Block regular Frank Valentic says suburbs like Elwood, Richmond and Reservoir could follow in Toorak’s footsteps, and reward buyers who get in early.
Advantage Property Consulting director and buyers advocate Frank Valentic said ripple effects from Melbourne’s most expensive suburbs were already pushing into more affordable postcodes, where gentrification, infrastructure upgrades and buyer demand were starting to overlap.
“Elwood, it’s Brighton’s neighbouring suburb and can benefit from ripple effect,” Mr Valentic said.
“Richmond, it’s Toorak’s neighbouring suburb and is more affordable.”
RELATED: See the light turning a house of worship to a home
‘I’d be locked out’: Mum’s $65,000 home warning
RCA: $130m village to build 195 homes for downsizers
Mr Valentic added that buyers willing to take a long-term view could also find opportunity in Reservoir, Preston, Dromana and McCrae.
“I think areas like Reservoir and Preston still offer great bang for buck,” he said.
“Peninsula suburbs such as Dromana and McCrae are great value for the water views you can get.”
While some suburbs have grown by more than $3m since the 1980s, Mr Valentic said the fundamentals of capital growth remained the same, starting in prestige areas and spreading outwards.
“They usually follow the ripple effect, the ripple starts in blue chip suburbs and spreads outwards to more affordable area,” he said.
Buyers’ advocate and The Block regular Frank Valentic says buyers chasing the next Toorak should watch for infrastructure upgrades, gentrification and proximity to blue-chip postcodes.
The sale of 5 Isabelle Court, Mill Park, for $986,000 highlights growing buyer interest in outer-ring suburbs tipped for gentrification, with Mill Park among those Frank Valentic says are now on the rise.
The Advantage Property Consulting director said even outer suburbs like Mill Park, Seaford and Frankston were now seeing signs of gentrification.
“Yes, some outer suburbs 20km plus from Melbourne are seeing gentrification,” Mr Valentic said.
He also said young buyers were often discouraged by today’s prices but could still build wealth by getting a foothold in the market.
“Yes, they would feel discouraged, but there are still opportunities to get into the market somewhere, even if it’s buying a unit or apartment.
“It’s important to stay positive and try to get your foothold in the market.
“You may need to be more flexible on your wish list and suburb criteria.”
Mr Valentic warned buyers to be cautious in certain inner-city markets.
“High-rise inner-city apartments and surrounding inner suburbs where there is an oversupply of properties compared to demand,” he said.
Frank Valentic has helped buyers snap up some of The Block’s biggest homes — but says Melbourne’s best future gains could be in underrated suburbs buyers can still afford. Photo: Glenn Ferguson
Dromana’s $1.26m sale at 4 St Mary’s Place shows the growing appeal of Mornington Peninsula suburbs offering water views and long-term capital growth, according to Frank Valentic.
Prominent Melbourne buyers advocate Cate Bakos said buyers in Melbourne’s top tier are more focused on rarity and long-term legacy, when speaking about prestigious St Georges Rd strip.
“At the end of the day, how do you even peg a value on something this rare?” Ms Bakos said.
“A huge block in Toorak versus a small one elsewhere, it’s not just about square metre rates.
“The valuation model becomes more subjective. It’s an art, not a formula.”
Ms Bakos said high-net-worth buyers were not necessarily swayed by borrowing conditions or market volatility.
“They’re not betting the farm, they’ve got multiple income streams and advisers around them,” she said.
“If it’s their dream home, they’re picturing what they can create, not necessarily what the bank would lend.”
“These kinds of buyers aren’t asking what something’s worth to the market. They’re asking what it’s worth to them.”
Cate Bakos says high-net-worth buyers aren’t swayed by borrowing limits or price tags, they’re driven by scarcity, lifestyle and the long-term value of securing a once-in-a-generation home.
The $1.19m sale of 3 Fiddled St, Reservoir, reflects increasing demand in inner-north suburbs that buyers’ advocates say echo Fitzroy and Brunswick’s early transformation.
Kay & Burton Stonnington director Darren Lewenberg said prestige buyers today often have family backing or wealth built over generations, and tend to be more considered in their approach.
“We’re seeing well-supported younger buyers from tech, internationally mobile professionals, and family-backed purchasers,” Mr Lewenberg said.
“Stonnington’s prestige market has long attracted families with generational wealth, high-income professionals, and increasingly, global buyers seeking security, education, and lifestyle.”
“If anything, today’s buyers are more considered, less driven by urgency, more attuned to long-term value.”
Kay & Burton Stonnington director Darren Lewenberg says Melbourne’s prestige buyers are more globally mobile and financially agile than ever and they’re focused on legacy, not just location.
Mr Lewenberg said even as prices have surged, buyers were not showing signs of compromising on land size or location.
“We aren’t seeing widespread compromise in terms of location or land size; the prestige segment remains resilient, underpinned by limited supply and enduring demand.”
Asked whether Melbourne’s top-tier price levels were sustainable, Mr Lewenberg said financial flexibility and long-term vision remained key.
“At this end of the market, long-term vision and financial agility continue to define success and therefore feel confident in the long term viability and sustainability of the top-end market,” he said.
Sign up to the Herald Sun Weekly Real Estate Update. Click here to get the latest Victorian property market news delivered direct to your inbox.
MORE: Inside Essendon great’s mid-century home
No more ‘awkward conversations’: wild rental crisis solution
‘Tough’ call as rents fall in 129 suburbs
david.bonaddio@news.com.au
English (US) · 